Vacancy for Receptionist/Administrator at our Penrith Office

We are seeking a full-time receptionist/administrator for our Penrith Office.

The ideal candidate will be conscientious, self-motivated, of smart appearance and will have good communications skills.  They will also be IT literate having a working knowledge of Microsoft Office though some training will be provided.

Please email your C.V explaining why you are suitable for the role to Helen Little (helen.little@saint.co.uk) by 31st May 2019.

Join us on 7 June 2019 in Carlisle for our Employment Update Event

If you run a small business or are involved in one, please join us for a refresher to help you stay compliant with employment law and government guidance on employee pay.

We’ll be discussing tips for effective staff management, taking on new employees, their rights, statutory payments and pensions.

Our 3 speakers will be talking about:

1. Employment solicitor – Michael Bauer, Cumbria Employment Solicitors – Smart use of Employment Law to Sharpen Your Business, including proactical steps and checklist to take away. Read more about Michael here.

2. Payroll Manager – Graeme Metcalfe, Saint & Co – An update on Minimum Wage, statutory payments and the eligibility for these payments and pension obligations. Read more about Graeme here.

3. HR Consultant – Debbie Tollitt, Davidson HR – Onboarding: A talk on the induction process for new starters including the suggested HR paperwork and right to work checks. Read more about Debbie here.

Friday, 7th June

12.00 noon – 2.30 pm

Buffet lunch included

The Halston, 20 – 34 Warwick Road,

Carlisle, CA1 1AB

This event is FREE but booking is essential as places are limited.

Please book early to avoid disappointment

Register here

Tax planning to minimise the high income child benefit charge

The substantial increase in the higher rate threshold to £50,000 is good news for many taxpayers. However, that same figure is the point at which child benefit starts being clawed back and there has been no increase in that threshold since the High Income Child Benefit Charge was introduced in 2013/14.

The charge applies if you have adjusted net income over £50,000 and either:

  • you or your partner get Child Benefit
  • someone else gets Child Benefit for a child living with you and they contribute at least an equal amount towards the child’s upkeep

It does not matter if the child living with you is not your own child. Adjusted net income is your total taxable income before any personal allowances and less things like Gift Aid and pension contributions.

The charge is 1% for every £100 that adjusted net income exceeds £50,000 multiplied by the child benefit claimed in respect of the children. Child benefit continues to be paid at the rate of £20.70 a week for the eldest child and £13.70 for each additional child.

Example

A couple with 2 children would receive £1,789 a year in child benefit. If the husband, a sole trader, made a profit of £55,000 (also his adjusted net income) after paying his wife a salary of £12,000 he would have to pay the high income child benefit charge of £894 (for 2018/19) in addition to his normal income tax and NIC bill.

If he brought his wife into partnership and they shared profits equally their income would be £32,500 each and there would be no high income child benefit charge. Similarly, if the business was a limited company they would be able to equalize their income so that the charge would not be payable.

Extracting profit from the family company

The start of the new tax year means that shareholder/ directors may want to review the salary and dividend mix for 2019/20. The £3,000 employment allowance continues to be available to set against the employers national insurance contribution (NIC) liability which means that where the company has not used this allowance it may be set against the employers NIC on directors’ salaries.

Thus, where the only employees are husband and wife there would generally be no PAYE or employers NIC on a salary up to the £12,500 personal allowance.

There would however still be employees NIC at 12% on the excess over £8,632 (£166 per week) which would be £464 on a £12,500 salary, leaving £12,036 net.

Taxation of Dividend Payments in 2019/20

Traditional advice would then be to extract any additional profits from the company in the form of dividends. Where dividends fall within the basic rate band (now £37,500) the rate continues to be 7.5% after the £2,000 dividend allowance has been used. Thus where husband and wife are 50:50 shareholders they would each pay £2,663 tax on dividends of £37,500 assuming they have no income other than a £12,500 salary, leaving £34,837 net of tax.

So a combination of £12,500 salary and £37,500 in dividends would result in £46,873 (93.7%) net of income tax and NICs.

Ensure dividend payments are legal

The Companies Act requires that companies may only pay dividends out of distributable profits. This means that in the absence of brought forward reserves the company would need to provide for 19% corporation tax in order to pay the dividends and thus there would need to be profits of £92,593 in order to pay dividends of £75,000 (after providing corporation tax of £17,593).

Overall the combination of salary and dividends suggested above would result in net of tax take home cash of £93,746 for the couple out of profits before salaries and corporation tax of £117,593 (20.3% overall tax). This still compares very favorably with the amount of tax and NIC payable if the couple were trading as a partnership.

LCR Systems have software for the hospitality and retail sector that can interface with Xero

Saint & Co thank LCR Systems,  one of our sponsors at BITE2018 for their support at our successful event last year and for writing this article about their software that can integrate with Xero.

L.C.R. Systems  partners with Saint and Co,  in providing their clients with the option of a fully interfaced link between Point of Sale and the Businesses Accounting Software.

L.C.R. Systems has been of service to businesses throughout Cumbria, North Yorkshire and Lancashire since the early 1970’s

L.C.R. Systems is recognised in the industry as a leading E.P.O.S. provider with a first class reputation. All our installed Systems are maintained and supported by our highly trained support staff on a 7 days a week basis either remotely or on your Business premises.

Jupiter our latest Windows based Software package for Hospitality and Retail now has the capability to interface with the popular Xero Accounting System. This in turn allows your Business to share key financial data between Point of Sale and Accounts.

With the requirement for digital filing of your business VAT returns from the 1st April 2019 increase your Businesses efficiency and accuracy by installing a fully interfaced System.

We would be happy to come and talk through with you the benefits of Jupiter E.P.O.S and how we can in increase your Business profitability.

Mark Proctor, Sales Director

 

 

 

Dairy Crest share sale April 2019

With the sale of Dairy Crest to Saputo in April, Dairy Crest shareholders should have now received the proceeds from the sale of their shareholding. While the funds are no doubt welcome for some, there will be tax implications for the future. For some farmers who owned Dairy Crest shares, they were generally acquired back in 1996 after Milk Marque disbanded. There may have been a cost associated with the share transfer at this point, so if you have any documents relating to this, they would be worth looking up, as this could save tax.

So how much tax is payable?

The sale of the shares will be subject to Capital Gains Tax (CGT), and as the sale was after 5 April 2019, any tax payable will be due on 31 January 2021, some 21 months away. This must be borne in mind when considering the usage of the funds received now.

Depending on the actual ownership of the shares and the individual circumstances of the tax payer, it is difficult to put a tax percentage on this. Each individual tax payer will have an annual CGT exemption of £12,000, which will lessen any CGT payable, however, if the shares are owned by a company, the tax payable would also be different.

If you have received share sale proceeds, it would be prudent to consider the tax position now, rather than receive a larger that normal tax bill in January 2021. There may be options available to lessen any CGT, so planning for this now may be beneficial.

If you want to know more, contact us.

Disguised remuneration loan charge started in April 2019

This new charge will apply to certain loans to directors and employees that are still outstanding at 5 April 2019 and new arrangements put in place after that date.

The charge affects arrangements involving loans made via Employee Benefit Trusts (EBTs) and similar disguised remuneration schemes adjudged by HMRC and the courts to be tax avoidance and liable to PAYE and National Insurance Contributions.

There are new reporting and payment obligations that come into force for employers using such schemes from 5 April 2019  Where the employer does not pay the tax and national insurance the liability can be passed to the individual who benefited from the loan.

Where the individual concerned had taxable income in the 2018/19 tax year of less than £50,000 they will be able to repay the liability over 5 years, and spread over 7 years if their 2018/19 taxable income of less than £30,000.

Why you need to understand your numbers

Why you need to understand your numbers

Over the years, we’ve seen our fair share of busy business owners fall into the same trap.

They get so wrapped up in their day-to-day activities that they forget to take a step back and look at the bigger picture. Where is the business going? Are there any opportunities on the horizon? And which threats are lurking in the shadows?

Often they’re so focused on working in the business, that they neglect to work on it. So much so that opportunities are missed, and threats appear with little-to-no warning.

That’s why it’s vital that you understand your numbers.

But which numbers are we talking about?

We don’t just mean knowing the number in your bank account (although keeping an eye on that is obviously critical).

As a small business owner, these are the all-important numbers you need to understand:

1. Cash Flow

Understanding and monitoring your cash flow is crucial. It’s the lifeblood of your business. Money in, money out; if you fail to track that, you could soon veer off course. Right over a cliff edge, if you’re not careful!

If the cash flowing out of your business exceeds the amount flowing in, you have a serious problem. But with a detailed and regular cash flow forecast, you’ll ideally spot such a problem far enough in advance to do something about it. A gap in your cash flow could be a sign to cut costs, raise prices, seek additional funding, or restructure the business.

2. Net Profit

A close relation of cash flow, your net profit is the result of subtracting your expenses from your income. Net profit is important as it clearly indicates whether you’re making or losing money. It’s also a good number to know as your tax bill is calculated based on your net profit. If you don’t want to be stung by a large and unexpected tax bill, get to know your net profit a little better.

3. Profit and Loss (P&L)

Also known as an income statement, P&L is a handy number to track over time. While you might be more drawn to looking at the net income figure of your business in isolation, the profit and loss statement looks at both your net income (operating and non-operating) and your expenses (such as taxes) during a specific period of time. Understanding your P&L helps you identify any challenges or obstacles that might arise in the future, allowing you to allocate budget and resources accordingly.

4. Gross Profit

Sometimes called the gross margin, your gross profit shows you how much money is left after the actual cost of your goods or services is subtracted from the sales price. If this number is low and barely enough to cover operating costs, such as rent, salaries, utilities, and marketing, it could be a sign that you need to either increase your prices or cut some costs.

Put these numbers at your fingertips

After a long, hard day running your business, the very last thing you’ll want to do is plug figures into a spreadsheet trying to find and understand these numbers.

Thankfully, there’s an easier way. Integrated cloud accounting software such as Xero can grab your income and expenses via secure bank feeds and seamlessly populate reports, putting the most important financial numbers at your fingertips.

Using Xero also makes it easier to collaborate with your accountant and review your cash flow to spot opportunities and ward off threats.

Interested in giving it a go? Contact us today and speak with one of our friendly Xero experts.

Scottish Land and Buildings Transactions Tax

Land and Buildings Transactions Tax is the Scottish equivalent of Stamp Duty Land Tax although they are not identical in many respects.   For residential properties, the rates and bands for land and buildings transactions tax (“LBTT”) will be unchanged for 2019/20, although the additional dwelling supplement will be increased from 3% to 4%.

The lower rate for non-residential properties will be reduced from 3% to 1%, and the upper rate increased from 4.5% to 5%. The upper rate will apply to the portion of the purchase price over £250,000 (reduced from £350,000).

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